Foreclosures by Race and Ethnicity: The Demographics of a Crisis
ince housing prices began their precipitous decline in January 2007 and oreclosure ratesskyrocketed, no one has assessed exactly how many mortgages have ended in oreclosure orwho has been aected. Although a number o useul mortgage databases are available, there is nooicial, nationwide, publicly available census o completed oreclosures or associated demographicinormation. In this report, we seek to shed light on the nation’s oreclosure crisis by using govern-ment and industry data to estimate the number o oreclosures in recent years and their impact byrace and ethnicity. More speciically, we calculate oreclosure rates rom 2007 through 2009 or1,632 combinations o loan types, geography, occupancy types and closing years, and apply theserates to mortgage origination data. The results are these key estimates on completed oreclosures:During the irst three years o the oreclosure crisis, rom January 2007 through the end o 2009, weestimate that 2.5 million oreclosures were completed.The vast majority o these oreclosures wereon owner-occupied properties with mortgages that were originated between 2005 and 2008.
The majority (an estimated 56%) o amilies who lost homes were non-Hispanic and white, butArican-American and Latino amilies were disproportionately aected relative to their share o mortgage originations.
Among recent borrowers, we estimate that nearly 8% o both Arican Americans and Latinoshave lost their homes to oreclosures, compared to 4.5% o whites.
The racial and ethnic disparities in these estimated oreclosure rates hold even ater controlling ordierences in income patterns between demographic groups.
The figure below shows completed foreclosures per 10,000 loans for African Americans, Latinosand non-Hispanic whites:
African American Latino Non-Hispanic White
2007-2009 Completed Foreclosures per 10,000 Loans
(on loans made in 2005-2008 to owner-occupants)